Markets held their early advances while gold sets another record

Dow zoomed 478, advancers over decliners 4-1 & NAZ finished higher, up 83.  The MLP index continued to hold in the 281x & the REIT index remained higher, up 8+ the to 382s.  Junk bond funds rose along with the stock market & Treasuries had more buying which reduced yields.  Oil was little changed in the 81s & gold advanced 12 to 2212 for a new record (more on both below).

AMJ (Alerian MLP Index tracking fund)

Carnival (CCL) raised its annual profit forecast, anticipating a record year of bookings as the company benefits from a rise in people seeking cruise vacations for the first time.  Cruise operators are recording all-time high booking rates as more travelers switch to cheaper sea-borne experiences over expensive land-based alternatives such as booking hotels or flights, providing them more room to raise prices.  “The first quarter has been fantastic across the board,” CEO Josh Weinstein said.  “We delivered record bookings and record customer deposits again this quarter, a great start to the year.”  The company's first-qtr revenue jumped 22% to $5.4B, roughly in line with expectations.  Bookings for the rest of 2024 remain the best year on record with total customer deposits reaching $7B in the first qtr.  New-to-cruise customers surged more than 30% year-over-year, CCL added.  CCL also estimated an impact of up to $10M on full-year adjusted EBITDA & adjusted net income following Baltimore's Francis Scott Key Bridge collapse.  The cruise operator now expects full-year adjusted EPS of 98¢, compared with its prior forecast of 93¢.  The forecast expected EPS of $1.  Carnival posted an adjusted net loss per share of 14¢, compared to expectations of 18¢.  The stock went up 16¢.

Carnival rides on record cruise demand to lift annual profit forecast

Orders for long-lasting US manufactured goods increased more than expected in Feb, while business spending on equipment showed tentative signs of recovery as the economy's growth prospects in the first qtr remained upbeat.  But Nov's presidential election, a rematch between incumbent Joe Biden & Rep challenger Donald Trump, looms large.  A survey from the Conference Board showed Americans growing increasingly concerned about the political environment & less worried about a recession over the next 12 months.  The rebound in durable goods orders recouped some of Jan's sharp losses, & implied manufacturing could be regaining its footing after struggling in the aftermath of the Federal Reserve's hefty interest rate hikes.  "The data suggest that business equipment investment is beginning to recover, and with corporate bond yields likely to fall a little further over the coming months while manufacturing activity appears to be picking up again, we suspect that recovery has further to run," said Andrew Hunter, deputy chief US economist at Capital Economics.  Orders for durable goods, items ranging from toasters to aircraft meant to last 3 years or more, rose 1.4% last month, the Commerce Dept's Census Bureau said.  Data for Jan was revised lower to show orders falling 6.9% instead of the previously reported 6.2%.  The forecast for durable goods orders was expected to rise 1.1%.  Orders advanced 1.8% on a year-on-year basis in Feb.  The outlook for manufacturing, which accounts for 10.3% of the economy, is steadily improving amid expectations that the central bank will start cutting rates this year.

US durable goods orders rebound

Disney (DIS), a Dow stock, agreed to end litigation in state court involving a Florida special tourism district that the entertainment giant effectively controlled for more than 5 decades until last year after Gov Ron DeSantis moved to revoke that status.  The settlement lifts a significant barrier to the continued development of Walt Disney World in the Orlando area & provides for the potential resolution of a related federal case.  The state lawsuit was filed by the Central Florida Tourism Oversight District (CFTOD) to void agreements the old district board had signed with DIS right before it was dissolved at DeSantis' behest after DIS opposed Florida’s “Don’t Say Gay” bill backed by the governor.  DIS in turn had asked the court to rule that the agreements, which benefited the company, were valid.  As part of the settlement of that case, DIS agreed not to challenge the CFTOD's determination that the prior agreements with the old Reedy Creek Improvement District were null & void.  The settlement also includes DIS's agreement to seek permission from a federal appeals court to pause its effort to revive a dismissed retaliation lawsuit against DeSantis in Florida federal court in light of expected negotiations of “among other matters a development agreement” between the company & the district.  That clause suggests that if DIS is satisfied with the outcome of the negotiations, it might drop the federal civil complaint against the governor.  Walt Disney World President Jeff Vahle said, “We are pleased to put an end to all litigation pending in state court in Florida between Disney and the Central Florida Tourism Oversight District.”  “This agreement opens a new chapter of constructive engagement with the new leadership of the district and serves the interests of all parties by enabling significant continued investment and the creation of thousands of direct and indirect jobs and economic opportunity in the State,” Vahle added.  The stock rose 1.04.

Disney agrees to settle Florida lawsuit with special district backed by DeSantis

Gold closed at a record high again, pushing back above $2200 even as the $ strengthened, buying momentum for the metal continues, backed by expectations lower interest rates are on the horizon.  Gold for May closed up $13 to settle at $2212 per ounce, topping the previous record of $2206 set on Mar 21.  The price of the metal is being supported by a Federal Reserve forecast that interest rates could be lowered 3 times this year for a total cut of 75 basis points.  However Fri's release of the US PCE Index, the Fed's preferred inflation measure, could affect the central bank's expectations.  The estimate expects the PCE index rose by an annualized 2.5% in Feb, up from a 2.4% rate a month earlier.  However the core index, excluding volatile items, is expected to fall 0.3% from Jan, down from a rise of 0.4% that month.  The $ rose early, making gold more expensive for intl buyers.  The ICE dollar index was last seen up 0.09 points to 104.38.

Gold Pushes Back Above US$2,200, Closes at a Record High

West Texas Intermediate (WTI) fell again after the Energy Information Administration said US oil inventories unexpectedly rose last week, but less than a private report released a day earlier reported.  WTI crude oil for May closed down 27¢ to settle at 81.35 per barrel, while May Brent crude, the global benchmark, closed down 16¢ to $86.09.  In its weekly survey, the EIA said US oil inventories rose by 3.2M barrels last week, ahead of the estimate for a 1.3M barrel drop, but well under the 9.34M increase reported by the American Petroleum Institute yesterday.  OPEC+ will meet next week with the group expected to make no changes to its 2.2M barrels per day of voluntary production cuts until a ministerial meeting scheduled for Jun, even as the group overproduced its quotas by 190K barrels per day in Feb.

WTI Crude Oil Closes Lower as a Report Shows US Oil Inventories Rose Last Week, But not as Much as Feared

After a 3 day losing streak, Dow opened with a strong advance.  It held early gains until there was additional buying into the close.  The current rally is betting heavily on 3 rate cuts this year.  Meanwhile gold set another record.  These buyers are worried about the effect that high interest rates will have on the economy.

Dow Jones Industrials